Recession, Historic Election Mark 2008

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Barack Obama

Barack Obama

“There is a Chinese curse which says “May he live in interesting times.” Like it or not, we live in interesting times.” — Robert F. Kennedy, 1966

Just one  day into 2009, it’s too early to tell how history will regard the previous year. One thing does seem safe to say: we are living in interesting times.

In less than three weeks, America will watch as President-elect Barack Obama takes the oath of office. When he does, he will become the first African-American President in our nation’s history. Obama’s victory inspired spontaneous celebrations by supporters on Election Night. A record number of voters cast ballots in the historic Presidential election – more than 131 million nationwide.

His victory brings an end to eight years of Republican control of the White House under George W. Bush, who ends his term as the least popular President in recent memory. Although Democrats will take control of the executive office and both houses of Congress, other events of 2008 will challenge Obama’s administration.

falling-graphIn December, economists officially declared something that most Americans had known for some time: the U.S. economy was in recession. The federal government approved a program to send a one-time economic stimulus payment to most U.S. taxpayers in February, but it wasn’t enough to get the economy back on track; the sub-prime mortgage crisis continued to shape the financial landscape.

In March, the Federal Reserve tried to prop up global investment bank Bear Stearns, but the company could not be saved. It was swallowed up for pennies on the dollar by JPMorgan Chase. Bear Stearns was the first of many major financial sector companies to fall in 2008.

In September, the Federal Housing Finance Agency took control of pseudo-government lending agencies Fannie Mae and Freddie Mac amidst concerns that they didn’t have enough financial liquidity to fulfill their roll in the mortgage marketplace.

Just one week later, Lehman Brothers filed for bankruptcy, Merrill Lynch merged with Bank of America, and the federal government purchased a 79.9 percent equity stake in AIG. Washington Mutual, the nation’s largest savings and loan, also failed in September.

All of this instability in the financial sector was reflected in the stock market, which plummeted. The stock market collapse wiped out individuals’ retirement savings and put pension funds at risk. New Jersey’s pension fund lost more than half of a $200 million investment in Lehman Brothers due to the firm’s bankruptcy.

Desperate to stop the bleeding, the federal government negotiated a bailout plan for Wall Street. On Oct. 3, President Bush signed the Emergency Economic Stabilization Act, creating a $700 billion Treasury fund to purchase failing bank assets. Originally envisioned as a means of removing sub-prime mortgage-backed assets from the marketplace, the fund was instead used to provide liquidity for the nation’s banks in the hopes that would un-freeze the credit market.

The program did little to encourage investors that the stock market would stabilize or promote lending by central bankers. Continuing worries about the economy and a lack of available credit caused retail sales to decline for five straight months – from July through November. Such a period of weakness has never been seen before in the government’s retail sales records.

President George W. Bush

George W. Bush

Weak sales of cars and light trucks brought Detroit automakers to the brink of bankruptcy. For much of November and December, General Motors, Chrysler and Ford begged Congress for their own bailout program. Senate Republicans refused to budge, even though more than two million workers in every state depend on the auto industry for their livelihoods.

Just three weeks ago, President Bush reversed his position and recommended that the Wall Street bailout fund be used to keep the auto industry afloat until the new Congress is seated next week.

Meanwhile, the unemployment rate continued to climb. In November, the state lost 6,200 jobs to bring the unemployment rate to 6.1 percent, the highest it’s been since Aug. 1996. Nationally, the unemployment rate stands at 6.7 percent. New Jersey’s Unemployment Insurance Trust Fund could run out of money next year, thanks to the higher rate of unemployment claims and lawmakers’ past practice of shifting money from the fund to pay for state aid to New Jersey hospitals.

It’s not clear how soon the economy will get better, but there was one small measure of solace for the average individual. The global economic slowdown put the brakes on out-of-control gas prices. After rising sharply through the first half of the year, New Jersey prices peaked just below $4 per gallon of regular unleaded in early July. Just before Thanksgiving, prices fell below $2 per gallon for the first time since Dec. 2005. By mid-December, they’d fallen even further – to $1.60 per gallon. For the first time in 25 years, global demand for oil declined in 2008.

Tolls on the Garden State Parkway and New Jersey Turnpike went up in December after months of hearings and proposals. The 40 percent fare hike will be used to fund road expansion and a second rail tunnel between New Jersey and New York.

 

Joseph Vitale

Joseph Vitale

State Sen. Joseph Vitale proposed an ambitious program that would eventually make sure that all New Jersey residents have health insurance. Lawmakers expanded the New Jersey Family Care program and required all New Jersey children to have health coverage as a first step, but the current economic conditions make it seem unlikely that Vitale’s goal of full coverage can be achieved by his 2011 target date.

 

New Jersey also passed the paid family leave law. Workers will be able to take up to six weeks of paid family leave to take care of a sick relative or a newborn or newly-adopted child. A new 0.14 percent tax on wages will fund the program.

Global warming continues to be a concern, but local officials are beginning to take steps to combat the problem. For example, the Union County Freeholders announced a number of green initiatives at the beginning of the year, aimed at promoting energy efficiency, increased recycling and education. Edison increased the number of fuel-efficient hybrid vehicles in the municipal fleet.

 

Neil Cohen

Neil Cohen

Union County Assemblyman Neil Cohen was indicted on child pornography charges last month. Cohen resigned this summer while he was under investigation. Cohen is accused of printing an image of a nude underage girl and leaving it at the 20th District Legislative Office and having additional images on his state-issued computer.

 

Longtime Perth Amboy Mayor Joseph Vas, who also serves as a state Assemblyman, lost his re-election bid to political newcomer Wilda Diaz. The Vas administration is currently under investigation by federal and state authorities for activities that took place during his tenure as the city’s mayor.

Former Congressman Matthew J. Rinaldo, who represented Union County in the U.S. House of Representatives for 20 years, died in October at age 77. Longtime Middlesex County Freeholder David Crabiel died in December at age 78. Democrats are expected to name his replacement this week.

The saga of Richard Zarinsky finally reached its end in 2008, when the convicted killer died in jail on the 50th anniversary of Rahway Police Officer Charles Bernoskie’s death. Zarinsky had been implicated in Bernoskie’s murder by his own sister, but a jury failed to convict him. A civil jury ruled that Bernoskie’s widow was entitled to a cash award in a wrongful death suit, however that was later overturned on appeal. She had to repay the money, which was able to do thanks to the support of the state Policeman’s Benevolent Association.  

Union County Prosecutor Theodore Romankow announced the creation of a county-wide homicide task force under his direction in September. The move came in part because of the large number of unsolved murders in Elizabeth, yet the city refused to contribute any officers to the force.

Perth Amboy Police Officer Thomas Raji, 31, was killed in a car accident while he was transporting a prisoner in August. He is the first officer in city history to be killed in the line of duty. Colonia resident Sean McGuirk, 23, was indicted last month for vehicular homicide. Authorities say he was drunk at the time of the crash.

Rahway celebrated the 150th anniversary of its incorporation as a city in 2008. The city held a variety of events to mark the occasion, including a series of special arts-related events on the first Thursday of each month, a block party, and a gala celebration in June. Perth Amboy celebrated the 325th anniversary of its charter in 2008 with a variety of events as well.

After a series of delays and cost overruns, Perth Amboy finally opened the controversial Public Safety-Court-Community Complex on New Brunswick Avenue this year. The facility is home to the city’s municipal court, police headquarters and a community center.

Esposito Park, created on the site of the former Esposito Farm on Madison Hill Road in Clark, opened in October. Earlier in the year, Clark Township finally completed the transfer of the Clark Reservoir to the Union County Parks System, which will take over the maintenance costs of the site.

The Linden Public Library temporarily closed this summer for renovation work. The main library has re-opened, though work is still proceeding. The children’s department is still offering library services out of the Gregorio Recreation Center on Helen Street. The Union County Performing Arts Center in Rahway re-opened after a $6.2 million renovation project that took more than a year to complete.

Astronaut Kenneth Ham, a 1983 graduate of Arthur L. Johnson Regional High School in Clark, piloted a Space Shuttle mission to add a new laboratory module to the International Space Station this spring.

Edison native Jeremy Zuttah was selected in the third round of the NFL Draft by the Tampa Bay Buccaneers. The J.P. Stevens High School alumni has made four NFL starts and played in 10 games on the Buccaneers’ offensive line this season.

Colonia’s Jeff Carlson was selected in the first round of the NHL Draft by the Washington Capitals with the 27th overall pick. Elizabeth High School graduate Roberto Ramos signed a contract to play baseball in the Boston Red Sox organization. In 18 games for the Gulf Coast League Red Sox (Fort Meyers, Fla.), Ramos hit .261, drove in five runs and stole two bases.


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